Key Takeaways
- Wisconsin requires workers' compensation when you employ 3 or more employees
- Coverage must be obtained on the day you hire the third employee
- Employers with fewer than 3 employees may still be required to have coverage based on payroll thresholds
- Workers' compensation provides no-fault coverage for workplace injuries and illnesses
- Corporate officers can opt out only if they own at least 10% of a closely-held corporation with 10 or fewer stockholders
Wisconsin Workers' Compensation Insurance
Wisconsin has mandatory workers' compensation insurance requirements administered by the Department of Workforce Development (DWD).
Coverage Requirements
When Coverage is Required
Wisconsin employers must have workers' compensation insurance if:
| Threshold | Requirement |
|---|---|
| 3+ employees | Required on day of hiring third employee |
| Payroll threshold | Required if paying $500+ in combined gross wages in any calendar quarter |
Payroll-Based Requirement
Even with fewer than 3 employees, coverage is required if:
- You pay combined gross wages of $500 or more
- In any calendar quarter
- To one or more full-time or part-time employees
- Must have insurance by 10th day of next quarter's first month
Employee Definition
Who is Considered an Employee
| Included | Not Included |
|---|---|
| Full-time workers | Sole proprietors |
| Part-time workers | Partners |
| Seasonal workers | LLC members |
| Temporary workers | Independent contractors |
| Leased employees | Some agricultural workers |
Corporate Officers
| Status | Requirement |
|---|---|
| General rule | Considered employees, must be covered |
| Opt-out allowed | Only for closely-held corporations (10 or fewer stockholders) |
| Opt-out limit | Maximum of 1-2 corporate officers may opt out |
| Ownership requirement | Must own at least 10% to opt out |
How to Obtain Coverage
Options for Wisconsin Employers
-
Private Insurance Company
- Licensed to write workers' compensation in Wisconsin
- Policy must name Wisconsin as covered state in Section 3-A
- Most common option
-
Wisconsin Compensation Rating Bureau Pool
- For employers who cannot obtain private coverage
- Workers' Compensation Insurance Pool
- Residual market option
-
Self-Insurance
- Requires approval from Assistant Secretary of OWC
- Must demonstrate financial ability
- Typically for large employers
Policy Requirements
The insurance policy must:
- Be filed with Wisconsin Compensation Rating Bureau
- Name Wisconsin as a covered state
- Cover all employees (with limited exceptions)
- Meet state benefit requirements
Exam Tip: Wisconsin requires workers' compensation for employers with 3 or more employees. Coverage must be obtained on the DAY you hire your third employee, not after.
How many employees must a Wisconsin employer have before workers' compensation is required?
Workers' Compensation Benefits
Wisconsin workers' compensation provides comprehensive benefits for workplace injuries and occupational diseases.
Medical Benefits
| Feature | Description |
|---|---|
| Coverage | All reasonable and necessary medical treatment |
| Deductible | None for the employee |
| Duration | As long as treatment is needed |
| Choice of doctor | Employee can choose physician |
| Travel expenses | Covered for medical appointments |
Disability Benefits
Temporary Total Disability (TTD)
- For employees who cannot work at all during recovery
- Benefit: 66.67% of average weekly wage
- Subject to state maximum
- Waiting period: 3 days (waived if disability exceeds 7 days)
Temporary Partial Disability (TPD)
- For employees who can work in limited capacity
- Benefit: 66.67% of difference between pre-injury and current wages
- Encourages return to work
Permanent Partial Disability (PPD)
- For lasting impairment after maximum medical improvement
- Based on disability rating
- Schedule of benefits by body part
- May be paid in addition to TTD/TPD
Permanent Total Disability (PTD)
- For employees who cannot return to any work
- Benefit: 66.67% of average weekly wage
- Paid for life
- Subject to state maximum
Death Benefits
| Benefit | Amount |
|---|---|
| Burial expenses | Reasonable costs covered |
| Spouse benefits | 66.67% of AWW for life or until remarriage |
| Child benefits | Percentage based on number of children |
| Maximum | Subject to state maximum limits |
No-Fault System
How It Works
- Employee receives benefits regardless of fault
- No need to prove employer negligence
- Quick payment of benefits
- No litigation required
Exclusive Remedy Doctrine
- Workers' compensation is typically the ONLY remedy
- Employees generally cannot sue employers for workplace injuries
- Exceptions exist for intentional acts
Exam Tip: Wisconsin workers' compensation pays 66.67% (two-thirds) of the average weekly wage for disability benefits. Know this percentage for the exam.
What percentage of average weekly wages do Wisconsin workers receive for temporary total disability benefits?
Penalties for Non-Compliance
Employer Penalties
| Violation | Penalty |
|---|---|
| Failure to maintain coverage | 2× premiums that should have been paid (minimum $750) |
| Operating without coverage | Business may be ordered to cease operations |
| Repeated violations | Additional penalties and prosecution |
Consequences of Non-Compliance
- Financial penalties: Double the premium amount that should have been paid
- Cease operations order: Wisconsin can force business closure until coverage obtained
- Personal liability: Employer personally liable for employee injuries
- Loss of exclusive remedy: Employee can sue in civil court
- Criminal penalties: Possible for willful violations
2026 Updates
Effective January 1, 2026:
- Worker's compensation adjudicatory functions transferred to Worker's Compensation Division
- Hearings handled by Department of Workforce Development
- Streamlined claims process
Employer Responsibilities
Required Actions
| Responsibility | Timing |
|---|---|
| Obtain coverage | Before or on day 3rd employee hired |
| Post notice | Display WC information in workplace |
| Report injuries | Promptly report to insurer |
| Cooperate with claims | Provide information as requested |
| Maintain records | Keep payroll and injury records |
Claim Filing Process
- Injury occurs: Employee reports to employer
- Employer notifies insurer: File First Report of Injury
- Medical treatment: Employee receives care
- Insurer investigation: Review of claim
- Benefits determination: Payment of benefits begins
- Ongoing management: Continue until claim resolved
Exam Tip: Penalties for failing to maintain workers' compensation in Wisconsin include paying twice the premiums that should have been paid, with a minimum penalty of $750.
What is the minimum penalty for a Wisconsin employer who fails to maintain required workers' compensation insurance?
Which corporate officers can opt out of workers' compensation coverage in Wisconsin?